Agency for the Cooperation of Energy Regulators gets a new legislative framework: Presidency reaches provisional agreement with European Parliament

Source: Council of the European Union (Council) i, published on Wednesday, December 12 2018.

The Presidency of the Council and the European Parliament today reached a provisional agreement on the revised regulation establishing the Agency for the Cooperation of Energy Regulators (ACER). The deal still needs to be endorsed by member states.

The regulation updates the role and functioning of the agency, including the tasks of its director and board of regulators. Since its creation in 2011, ACER has already played an important role in facilitating cooperation between national energy regulators. The update to the legislative framework had become necessary in order to adapt the regulatory oversight to the new realities of an increasingly interconnected European energy market.

One of the key elements of the agreement concerns the regulatory oversight of European entities, including the European Network of Transmission System Operators for Electricity (ENTSO-E) and the EU entity of Distribution System Operators (EU DSO entity). The regulatory oversight is already carried out jointly by national regulatory authorities and ACER, but the new provisions reinforce the supporting role played by the agency in identifying when a breach of obligations has occurred and acting as an arbitrator in case of disagreement between different national regulatory authorities on whether or not there has been a breach of obligations. However, the national regulatory authorities remain solely competent to enforce any decisions directed at the European entities. The enforcement of oversight by national regulatory authorities is regulated in the directive on electricity, which is still being negotiated between the co-legislators. The ACER regulation will be aligned accordingly.

The new regulation also redefines the distribution of competences between ACER's director and its board of regulators. When drafting certain opinions, recommendations and decisions of the agency, the director needs to take possible opinions, comments or amendments from the board of regulators into account or provide a justification if he does not do so. If the board of regulators does not approve the revised text, the director may revise it further or withdraw it and resubmit a new text.

Background and next steps

ACER has already improved coordination between regulators on cross-border issues. The agency was officially launched in March 2011 and has its seat in Ljubljana, Slovenia.

The Commission presented its proposal on the recast ACER regulation on 30 November 2016 as part of the clean energy package. The current legislative framework is based on a regulation which dates back to 2009 and which established ACER.

The Council adopted its position ("general approach") on the recast ACER regulation in June 2018. Negotiations with the European Parliament started in autumn. Member states will now examine the provisional agreement, which still needs to be endorsed by the Council's Permanent Representatives Committee. The formal vote in both the Council and the European Parliament will follow at a later stage.

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